Gatos Silver, Inc. (NYSE:GATO) Q2 2023 Earnings Conference Call August 9, 2023 11:00 AM ET
Company Participants
Dale Andres - Chief Executive Officer
Andre van Niekerk - Chief Financial Officer
Conference Call Participants
Operator
Ladies and gentlemen, thank you for standing by. Welcome to the Gatos Silver Second Quarter 2023 Results Conference Call. Presenting today will be Dale Andres, CEO of Gatos Silver; and Andre van Niekerk, Chief Financial Officer. We will conclude today's session with a question-and-answer period, where other members of the Gatos Silver management team will be available. [Operator Instructions]
Turning your attention to Slide two, please note, today's call contains forward-looking statements. Various risks and uncertainties may cause actual results to vary. Gatos Silver does not assume the obligation to update any forward-looking statements.
I would now like to turn the call over to Dale Andres. Please go ahead.
Dale Andres
Thank you, operator, and good morning, everyone. Turning to Slide three, we continue to build on the foundation set last year. With strong liquidity throughout 2023, a $50 million capital distribution was paid by the Los Gatos joint venture to its partners on July 20, of which Gatos Silver received $35 million. We received $9 million -- or we used $9 million of that $35 million to retire the outstanding balance of the revolving credit facility and GSI is now debt-free with the full $50 million available under the revolving credit facility.
From an operating perspective, the Los Gatos joint venture continued to perform well with record mill throughput rate of over 2,900 tonnes per day. Our cost optimization initiatives contributed to offset the impact of the stronger Mexican peso against the dollar as well as other inflationary cost pressures. And we are now focused on completing the new reserve and resource estimate this quarter and continue to do both resource expansion drilling and Greenfield exploration on our over 100,000-hectare land package in the Los Gatos district. We currently have nine drill rigs and that's -- I'll talk about this a bit later, soon to be 10, working to extend the mine life and unlock the district potential.
Turning to Slide four, this shows our continued strong operating performance at the Cerro Los Gatos mine. As expected in the mine plan, we mined lower silver grades during the second quarter. We expect that silver feed grades will gradually decrease towards reserve grade over coming quarters and years as we move deeper in our deposit. Cerro Los Gatos had another record quarter of mill throughput in the second quarter, and we are continuing our debottlenecking efforts in the mine with a focus on productivity and equipment efficiencies.